Open Access Repository

Labor Markets in Asia: Issues and Perspectives

Asian Development Bank | January 2006

Abstract

Unemployment and underemployment are developing Asia's most important problems. On conservative estimates, the region is home to about 500 million workers who are either unemployed or underemployed. Therefore, helping people as workers is critical for poverty reduction.
Why cannot countries across Asia create enough employment for their growing labor forces? Are supposedly rigid labor markets the reason? This volume argues that while labor market reforms may be necessary in some specific cases, by no means are labor market policies the main explanation for the widespread increase in unemployment and stubborn underemployment across Asia.
Country specific studies for the People's Republic of China, India, Indonesia, Philippines, and Viet Nam undermine the case for across-the-board labor market reforms. Instead, the authors advocate well-designed, country-specific piecemeal reforms that target the particular policies which may inhibit employment creation.
The authors also argue that governments across developing Asia must bring the objectives of full, productive, and decent employment to the top of their agendas, and propose growth-promoting and human capital policies to achieve these objectives. In the authors' words: 'Unless these three objectives become a fundamental part of the macroeconomic agenda across developing Asia, it is easy to conceive a region, say 25 years from now, which, despite continuous growth, will still harbor most of the world's poor. Published by Palgrave MacMillan.